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RealTime Economic Issues Watch

In RealTime posts, PIIE senior staff and colleagues discuss the fast-moving economic news, financial developments, and public policy choices confronting the United States and the world.

Recent Posts

It Could Be Worse: Five Things to Be Thankful for in a Wobbly World Economy

by | November 25th, 2015 | 11:39 am

It’s all too easy these days to be pessimistic about the global economic outlook in a post-crisis world that has shown itself prone to persistent scrapes and bruises. But in the spirit of Thanksgiving, perhaps it’s time to try to take a glass half-full (of wine?) approach to gauging global economic performance. Here are five […]

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What Mauricio Macri Means for Brazil

by | November 24th, 2015 | 05:09 pm

In a presidential runoff on Sunday, Mauricio Macri of the opposition alliance Cambiemos became Argentina’s new president, ending over a decade of so-called Kirchnerism. While opening up Argentina’s economy and turning Kirchnerist economic policy on its head will be a major challenge for the president-elect, especially in view of the Peronist-dominated congress, his election victory […]

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Renminbi Inclusion in SDR—More about Financial Reform

by and Nicholas R. Lardy | November 24th, 2015 | 04:07 pm

The International Monetary Fund (IMF) will decide soon whether or not to add the renminbi to its Special Drawing Rights (SDR) basket. The Fund’s review of this issue last summer focused on two issues. The first, referred to as the gateway criterion, was a simple matter. China met this criterion as early as 2010 by […]

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Some Big Changes in Macroeconomic Thinking from Lawrence Summers

by | November 20th, 2015 | 03:24 pm

A lot of economists, myself included, have spoken about the need to fundamentally rethink major parts of macroeconomics following the global financial crisis. At a truly fascinating and intense conference on the global productivity slowdown we hosted earlier this week, Lawrence Summers put forward some newly and forcefully formulated challenges to the macroeconomic status quo […]

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The Misery of Brazil’s Economy

by | November 19th, 2015 | 01:31 pm

The sum of the inflation and the unemployment rates, referred to as the misery index, is often used as a measure of economic well-being. Brazil’s runaway inflation and rising unemployment over the course of 2015 show a steep increase in misery. There’s no respite in sight. Recently released consumer price index figures for October-November (from […]

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Capital Adequacy for Banks: Why the New Standard Falls Short

by | November 19th, 2015 | 11:49 am

Can systemically important banks now fail without placing the rest of the financial system or public funds at risk? Has “too-big-to-fail” been dealt with? “Yes” was the courageous judgment of the Financial Stability Board (FSB) when it unveiled its new capital adequacy regime on November 9 for the 30 banks identified as global systemically important […]

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A More Inflexible Fed Would Cause More Crises

by | November 18th, 2015 | 11:35 am

Having saved the US economy from a second Great Depression, the Federal Reserve has become a political scapegoat in the Congress for its own failures to secure the recovery. Rather than improving our tax code, investing in our future, or simply passing a budget that is little more than avoiding default, the House is prioritizing […]

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Christine Lagarde and the SDR Basket

by | November 17th, 2015 | 10:43 am

International Monetary Fund (IMF) managing director Christine Lagarde has thrown her personal support behind China’s long-time campaign for the inclusion of its currency, the yuan or renminbi, among the small basket of currencies that are used to value the IMF’s special drawing rights (SDR).1 On November 13, the IMF issued a statement in which Lagarde […]

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Euro Area Risk: Catalonia’s Secession Fight Is Not Contained

by | November 16th, 2015 | 05:29 pm

If only what happened in Catalonia stayed in Catalonia. A fumbled process of updating the Catalan Statute of Independence, started a decade ago, has evolved into what could become a serious constitutional crisis in Spain, with unpredictable consequences. With the financial crisis inflicting politically costly spending cuts on the Catalan government, its president, Artur Mas, […]

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Ten Questions on Productivity, the Holy Grail of Economics

by | November 16th, 2015 | 04:30 am

Productivity, the amount of goods or services firms and workers can produce per hour of labor, is as central a concept to modern economic thinking as it is elusive to grasp and explain.

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